Key benchmark indices languished in negative terrain in early afternoon trade. At 12:15 IST, the barometer index, the S&P BSE Sensex lost 127.14 points or 0.39% at 32,273.37. The Nifty 50 index fell 49.10 points or 0.48% at 10,092.05. Market participants lacked strong buying conviction amid subdued trading on Asian bourses after the outcome of the Federal Reserve meeting.
Key indices opened the session with small gains. Later, they slipped into the negative zone tracking subdued trading in Asian bourses.
The S&P BSE Mid-Cap index fell 0.71%. The S&P BSE Small-Cap index lost 0.86%. The losses in both the indices were higher than the Sensex's slide in percentage terms.
The breadth, indicating the overall health of the market, was weak. On the BSE, 1,613 shares declined and 735 shares advanced. A total of 129 shares were unchanged.
Pharma stocks surged as rupee weakened against the dollar. Glenmark Pharmaceuticals (up 3.75%), Lupin (up 3.41%), Cipla (up 3.28%), Divi's Laboratories (up 3.16%), Cadila Healthcare (up 3.07%), Sun Pharmaceutical Industries (up 2.02%) and Aurobindo Pharma (up 1.63%) edged higher. Strides Shasun (down 1.83%) declined. A weak rupee boosts the value of overseas earnings in local terms. Pharma companies derive substantial revenue from exports.
In the foreign exchange market, the partially convertible rupee was hovering at 64.4775, compared with its close of 64.27 during the previous trading session.
Dr Reddy's Laboratories (DRL) surged 4.69% at Rs 2,422 after the company said it has received an Establishment Inspection Report (EIR) from the United States Food and Drug Administration (USFDA) after the conclusion of audit at the company's Formulation Srikakulam Plant (SEZ) Unit II, Andhra Pradesh. The announcement was made during market hours today, 21 September 2017.
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Capital goods stocks declined. BEML (down 2.09%), Siemens (down 2.07%), ABB India (down 2.06%), Bharat Electronics (down 1.59%), L&T (down 1.27%) and Bhel (down 0.78%) edged lower. Thermax (up 1.2%) gained.
Shoppers Stop advanced 2.13% at Rs 430.90 after the company announced that its board approved execution of a commercial agreement with Amazon Seller Services (Amazon India), which shall come into force and effect from the receipt of all necessary approvals, as envisaged therein. The announcement was made after market hours yesterday, 20 September 2017.
The arrangement would expand the scope of its existing listing arrangement with Amazon India. There is no separate monetary consideration other than the mutual covenants and agreements of the parties. The company does not have any shareholding in Amazon India. Under the commercial agreement, Amazon India does not have a right/entitlement to appoint a director on the board of the company whether as a nominee, an observer or in any other capacity of any nature whatsoever.
Separately, the company said that a meeting of the board of directors of the company will be held on 23 September 2017, to consider raising funds through issue of equity shares on preferential basis subject to approval from the shareholders of the company and such other regulatory/statutory approvals, as may be required.
Overseas, Asian stocks were mixed after the dollar and US Treasury yields spiked following big news out of the Federal Reserve.
In the economic news, the Bank of Japan (BOJ), at the conclusion of its two-day monetary policy meeting today, 21 September 2017, kept monetary policy steady. In a widely expected move, the BOJ maintained the 0.1% interest it charges on a portion of excess reserves that financial institutions park at the central bank. The central bank also kept its yield target for 10-year Japanese government bonds around 0%. The decision was made by an eight-to-one vote.
US stocks closed at record highs yesterday, 20 September 2017, after the Federal Reserve indicated another rate hike this year was possible and that it would begin the unwinding of its balance sheet next month.
US central bank, at the conclusion of its two-day monetary policy meet yesterday, 20 September 2017, left rates unchanged. Fed stated that it will begin in October rolling off its $4.5 trillion balance sheet, most of which consists of the Treasuries and mortgage-backed securities.
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